Daily Alert: For Thursday 21st January 2016

Mark Nugent 2016 H1, Daily Alert, January 2016

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Current Sentiment and Today’s Economic Calendar
  • Negativity returns. All stock markets down and JPY up on safe haven flow. FTSE enters bear market (20% off last high) and Euro stocks hit 13 month low. WTI sees new lows.
  • New Zealand missed CPI badly.
  • UK Average Earnings slight miss.
  • US Core CPI slight miss.
  • Canadian MPC keep rates unchanged and are neutral on currency “current stance of monetary policy is appropriate.”
Critical Trades for this week
1. USDCAD – triggered and exited at breakeven just before rate announcement. Will re-enter at same price.
2. USDJPY – safe heaven flow destroys our setup.
3. EURUSD – smaller safe heaven flow takes currency in wrong direction.
4. USDSGD – moving towards entry zone. Note – negative sentiment goes against this trade as it lessens chance of US rate increases which benefits emerging market currencies.
5. USDSEK – remains on watchlist.
Tomorrow’s Calendar
Euro Rate decision and Draghi statement.